President Barack Obama said rising exports are a “bright spot” in the U.S. economic recovery while warning against complacency in the face of trade rivals such as China and Germany.
“We’ve been such a dominant economy for a long time, that our sale pitches and efforts have been a little more scattered” and perhaps not as effective, the president said at the White House during a meeting of his export council. The U.S. has “very aggressive” competitors.
American sales abroad surged 4.4% to a record $2.2 trillion in 2012, Census Bureau figures show.
“One of the biggest bright spots in our economy has been exports,” Obama said. He said the administration is focused on how “do we keep that momentum going,” as negotiators try to reach agreement on two proposed trade deals, one in the Pacific region, the other with the European Union.
The advisory panel, which usually meets twice a year, is headed by Boeing Co. Chief Executive Officer James McNerney. The business leaders on the panel, appointed by the president, make recommendations to the government on ways to increase sales and help shape the agenda on proposed trade deals.
Obama signed an executive order in March 2010 setting a goal of doubling exports over five years, or taking exports to $3.14 trillion in value by 2014 from $1.57 trillion in 2009.
He may fall short. Exports last year totaled $2.2 trillion. Each $1 billion in sales supports about 5,000 jobs, Obama said.
Obama has pledged to remove trade barriers abroad, help firms enter new export markets and offer government assistance with financing to meet the export goal.
Even with a global economic slowdown, Commerce Secretary Penny Pritzker said exports increased by $600 billion in the three-year period ended 2012, a level equal to the combined gross domestic product of Israel, New Zealand and Ireland.
“This is a seismic shift in exporting,” she said. There are 30,000 more businesses exporting than there were in 2009, she said, and “we’re on track to break an annual export record for the third consecutive year.”
Even so, growth of U.S. sales abroad slowed to a 2% annual rate in the past 12 months, Jason Furman, chief White House economist, told the council.
“That slowdown is an import reminder that our fortunes in part depend on the economic strength of the world, and we saw significant economic slowdown in 2012,” Furman said. Still, it is “starting to mend.”
The administration is currently negotiating two deals that, if concluded, would cover about two-thirds of the world markets.
The Trans-Pacific Partnership among 12 nations, including the U.S., would link an area with about $26 trillion in annual economic output. Obama said it’s “the fastest growing market in the world.
U.S. Trade Representative Michael Froman said negotiators are entering the final stages in the Pacific trade deal and aim to ‘‘wrap that up by the end of the year.’’
The accord would cover trade issues in such areas as agriculture, financial services, rules of origin and protections for companies that compete with state-owned enterprises.
The negotiations will be among the main topics when Obama travels to Asia beginning Oct. 6 for a meeting of the Asia Pacific Economic Cooperation organization and the Association of Southeast Asian Nations. All the nations involved in the Pacific pact are APEC members.
The second deal is the Trans-Atlantic Trade and Investment Partnership, which includes the U.S. and members of the European Union.
It would be the biggest trade deal ever, affecting about 30% of global commerce, eliminating $10.5 billion in tariffs and boosting trade by an estimated $280 billion a year. The agenda includes farm commodities, banking services, intellectual property, drugs, transportation, manufacturing, chemicals, cars, energy and airlines.
Negotiators want a pact by the end of 2014 but talks may take years. One round of talks has been held and another is set for next month. Any trade treaty must be ratified by legislatures on both sides of the Atlantic.
Both deals would require approval from Congress.
The U.S.’s last major trade deal with Korea began in 2006 and didn’t conclude until 2011.
The Commerce Department said today that the U.S. current account deficit fell 5.7% to $98.9 billion in the second quarter, the lowest in almost four years, as exports increased. The current account is the broadest measure of trade because it tracks not only sales but government transfers and investment flows.
The President’s Export Council was created by Richard Nixon in a 1973 executive order as an advisory panel of as many as 28 members to counsel the president on international trade. Obama last met with the council on March 12.